The news has fallen. Our social security benefit for 2022 will increase by 5.9%, slightly less than the estimate of 6.1% released by the government this summer. Still, that’s far more than the 1.3% increase we saw for 2021 and the 1.6% the year before.
The average monthly increase in dollars will be $ 92, making the average benefit of $ 1,657 per month for a single person. For a couple, an increase of $ 154 would amount to $ 2,753 per month.
The official cost of living adjustment letter will appear in December.
I’ve done my math for next year, and again I’m shaking my head. We have already been warned that I will have a rent increase. Heating fuel is likely to increase by 47 percent. We all know what happened at the grocery store. Medicare Part B will definitely go up, maybe a $ 10 per month increase.
There is a disturbing note, and we need to think about how this will play out for us individually. The question is, will this increase put us in a higher tax bracket?
It depends on our interim income. This number corresponds to any income (pension, wages, dividends, etc.) not coming from social security, plus half of the amount of social security. Those of us who earn less than $ 25,000 will not have federal tax on our Social Security. If that number is between $ 25,000 and $ 34,000, there will be a tax on half of our Social Security earnings. On top of that, it amounts to a tax on 85 percent of our Social Security income.
If your situation for 2022 is likely to place you in the category of taxes payable on your Social Security benefit, you can choose to have them withdraw money from your check each month. If you want to learn more, call the IRS at 1-800-772-1213 and ask for IRS Form W-4V.